What is the Plusvalia tax and could you reclaim it?

What is the plusvalía tax?

The plusvalía tax has become a very controversial legal issue when dealing with laws around Spanish real estate.

It is a tax which works by taxing the increased value of urban lands when sold. However, the Constitutional Court has declared it should not apply when a property is inherited, donated or when a property is sold at a loss.

Giving you the opportunity to reclaim any plusvalía tax that you almost certainly would have paid when selling, inheriting or donating a property.

New Spanish court rulings

In light of the ruling, taxpayers have the right to reclaim any tax that they may have already paid, with the average reclaim value being between €3,000 to €6,000. Therefore, it is always advisable to make an appeal.

Each appeal is dealt with my the local town hall and can be treated differently.

How is the plusvalía tax calculated?

The claim amount depends on the value of the land and could even be much higher as the amount to be paid is not based on the percentage of the profit/loss on the transition of the property (e.g. the sale of a house), rather the “cadastral value” and the amount of years that the property been owned for.

Have I paid the plusvalía tax?

In the past, the tax has been paid regardless of whether a profit was made when selling a property and because of this concerns have continued to rise over the years leading to questioning of the legitimacy of the tax.

What is certain is that the tax will have applied on all property sales and even those properties which were donated or inherited.